Brenntag strengthens strategic position and local presence in the growth region Asia Pacific with acquisition of expected EUR 220 million sales in 2010
Established network of 27 locations in nine countries, operated by nearly 800 employees, complements Brenntag’s existing distribution network
Purchase price is EUR 160 million on a cash and debt free basis
Brenntag, global market leader in chemical distribution, further expands its market position in the growth area Asia Pacific by acquiring 100% of the shares of EAC Industrial Ingredients Ltd. A/S, a sizeable provider of chemical distribution solutions in South and South East Asia. Selling company is Copenhagen based The East Asiatic Company Ltd. A/S, a stock-listed Danish company. The purchase price is EUR 160 million on a cash and debt free basis. With the acquisition, Brenntag gains access to an established distribution network active in nine countries with exceptional growth potential.
With this major acquisition in South and South East Asia Brenntag reinforces its growth strategy in the Asia Pacific region. EAC Industrial Ingredients holds an important market share and covers with subsidiaries markets in nine countries with local presences in Thailand, Vietnam, Indonesia, Philippines, Malaysia, Singapore, Cambodia, India and Bangladesh. In addition the high level of benefits between Brenntag and EAC Industrial Ingredients is expected to further enhance both customer service and access to world class suppliers. With extensive sales and marketing resources EAC Industrial Ingredients represents in-depth knowledge of local markets and relationships to more than 8,000 customers. For 2010 Brenntag expects sales of about EUR 220 million for EAC Industrial Ingredients.
“The acquisition of EAC Industrial Ingredients is a major step in the execution of Brenntag's growth strategy. We expand our existing presence in the growing markets of Asia Pacific, add significant market share and improve our market position in focused industries like Food & Beverage, Coatings, Personal Care and Pharma”, says Stephen Clark, CEO of Brenntag. “This strategic milestone develops our market position from a foothold in Asia to an established operational network, supporting our continued growth path in the region.”
The acquisition is a strategic investment for Brenntag. In the Asia Pacific region growing demand is expected in particular for sectors like Food, Cosmetics, Pharma and Coatings. Customers from these sectors are important for Brenntag. The knowledge of regional markets and their respective individual requirements will offer additional business opportunities and provides for synergies with existing Brenntag suppliers and customers. With the acquisition of EAC Industrial Ingredients Brenntag is one of the few companies operating in the whole region.
Henri Nejade, President of Brenntag Asia Pacific says: “We are delighted to acquire EAC Industrial Ingredients because it perfectly meets our requirements to further grow in this region. The acquisition will support our ability to better serve local demands in these fast-growing countries. I am convinced we will continue the Brenntag success story in Asia Pacific which is a major growth area for the global economy and consequently for Brenntag, too.”
Brenntag has already significant assets in Asia Pacific with 17 sites in 11 countries and the acquisition of EAC will increase the number of personnel in the region to about 1,000.
The Closing of the deal is expected in the course of July. EAC Industrial Ingredients’ existing team will continue their successful work under the Brenntag brand. Brenntag expects significant benefits from the combination of the two operations. No merger control notification was necessary with regard to the acquisition.
Brenntag is the global market leader in full-line chemical distribution (based on most recent market data). Linking chemical manufacturers and chemical users, Brenntag provides business-to-business distribution solutions for industrial and specialty chemicals globally. With over 10,000 products and a vast supplier base, Brenntag offers one-stop shop solutions to more than 150,000 customers. The value-added services include just-in-time delivery, product mixing, formulation, repackaging, inventory management, drum return handling as well as technical services. Headquartered in Mülheim an der Ruhr, Germany, Brenntag operates a global network with more than 400 locations in more than 60 countries. In 2009 the company realized global sales of EUR 6.4 billion (USD 8.9 billion) with approximately 11,000 people.
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Georg Müller, Stefanie Steiner
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